Nepal Airlines Corporation (NAC) has announced that it will be purchasing three additional aircraft to expand its domestic services. This decision comes after the corporation's financial health has started to improve, and it has been able to pay its EMIs on time for the past year. There is no doubt that the expansion will allow NAC to serve more people and potentially make more profits. Nepal's aviation market is growing, and NAC must have more aircraft to take advantage of this situation. However, NAC must also be cautious and avoid the corrupt practices of the past.
The decision to buy additional aircraft is a smart one, given the growing demand for domestic flights in the country. According to NAC officials, the corporation is purchasing "short takeoff and landing" aircraft that will be used for flights in rural areas. With a limited number of airplanes currently available, the expansion will allow NAC to expand its services and increase its profits. Additionally, NAC earned a profit of Rs 1 billion in the fiscal year 2021/22, making it a good time for the corporation to invest in additional aircraft.
To move forward with the procurement process, NAC has formed a seven-member subcommittee led by senior captain Sudhir Sumsher Rai. The subcommittee has already submitted its report to the NAC board, and the corporation will soon open the tender process to purchase the aircraft directly from the manufacturers. The expansion will allow NAC to operate flights to Mugu and Dolpa, as well as several locations in Far-western Nepal.
The power of confidence
While the decision to purchase new aircraft is positive, NAC must be cautious and avoid corrupt practices. The corporation must ensure that there is no room for corruption and that its officials do not resort to foul tricks, such as canceling flights deliberately, to give NAC a bad name and reputation. Such tendencies must be checked effectively if NAC is to make profits from the new aircraft to be purchased. The corporation should prioritize transparency and ensure that all processes are conducted ethically.
NAC's financial health has been improving, and it has been able to pay its EMIs on time for the past year. This is a positive development for the corporation, which used to seek funds from the government to pay its loans. In the past, NAC purchased two Airbus 330 wide-body aircraft and two A320 narrow-body aircraft, taking a loan from the Employees Provident Fund and the Citizens Investment Trust. After the COVID-19 pandemic hit the aviation sector, NAC was unable to pay the installment amounts for almost two years. However, it has been regularly paying the installment amounts since July 2022, indicating that the corporation's financial health is improving. This must find continuity.
Currently, NAC operates a fleet of two Twin Otter aircraft for its domestic flights, while its international flights are conducted by two narrow-body and two wide-body aircraft. The corporation owns six Chinese aircraft, but they have been out of function for a long time and NAC is planning to sell them. With the recent decision to purchase three new aircraft, NAC aims to expand its domestic services and improve its financial health. The addition of new aircraft will enable NAC to serve more remote areas and cater to the increasing demand for domestic flights.
The expansion of NAC's services will also have a positive impact on Nepal's economy. The air transport industry, including airlines and its supply chain, supports US $272 million of GDP in Nepal. Spending by foreign tourists supports a further US $807 million of the country's GDP, totaling US $1.1 billion. The expansion will allow NAC to serve more people and potentially increase the number of foreign tourists visiting the country.
NAC's decision to purchase three additional aircraft to expand its domestic services is a positive development for the corporation and Nepal's economy. The expansion will allow NAC to serve more people and potentially increase its profits. However, NAC must ensure that all processes are conducted ethically, and there is no room for corruption. With transparency and caution, NAC can make the most out of this opportunity and contribute to Nepal's economic growth.
Needless to say, NAC has come a long way since its inception and today’s need is to establish itself as a reliable airline in the domestic and international markets. Its current fleet boasts modern aircraft, and the airline is committed to expanding its services to new destinations. As the national flag carrier of Nepal, NAC represents the country and its people in the global aviation industry, and we should support its efforts to grow and improve.
Let's give NAC more wings so that it can fly higher and continue to contribute to the economic development and cultural exchange of Nepal.
